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© Volodymyr Kyrylyuk - Fotolia.com
Imagine you’re a real estate agent in Cold Mountain, N.C., using the tagline “Your Cold Mountain Real Estate Connection” to market your services. You receive a cease and desist letter from an enterprising developer who’s registered a federal trademark for the term “Cold Mountain” in connection with real estate brokerage and management services, demanding you stop using the term in your social media and advertising materials. Given how common the practice of marketing one’s real estate business with a place name is within the industry, the potential for disputes is significant. The issue is even more problematic when the community name is based not on geography but rather on a made-up term, such as Bellhaven Woods or Oakcroft.
What’s Protectable?
Trademark rights can exist even in the absence of formal registration. The rights of a trademark holder extend only to that company’s own field or related fields. That’s how two different companies—an airline and a plumbing fixture manufacturer—can both have trademarks on the word Delta.
However, generic descriptors for a category of goods or services are not defensible as trademarks. One cannot have a monopoly on the word “coffee” when used in connection with the sale of a cup of joe, for example. Beyond generic words, terms that describe a product or service are usually not able to be trademarked, but under special circumstances they can move over from descriptive to become protected. Using the term “rich” to sell your coffee probably wouldn’t ever rise to the level of a protected mark. But consider the case of using “sharp” to sell televisions: Once employed to describe picture quality, “Sharp” eventually became protectable because it was used by one company for a long enough time that consumers began to recognize the association.
Geographic terms are generally treated the same as descriptive marks: They are protectable if the mark owner was the first to use the name in connection with its product or service and consumers think of the company when they hear the name. (That’s why Nantucket Nectars is a registered trademark, despite the fact that the beverage company using it is based in Nantucket.) In addition, a place name isn’t seen as merely descriptive if the public doesn’t associate the term with a specific place. So, a place that’s relatively obscure, newly minted, or generic enough to be associated with multiple locations is generally protectable as a trademark.
The Trademark Fair Use Defense
Thankfully, the fair use doctrine in U.S. trademark law offers some flexibility. The use of a place name to state where a business is located is generally acceptable, provided it doesn’t suggest an affiliation with the mark holder. “Nominative” fair use allows you to refer to the trademark owner or its product as long as the brand you reference is not easily identifiable without use of the trademark, you only use as much of the mark as necessary, and you don’t falsely suggest a relationship with the trademark owner. This is what allows an auto mechanic shop to advertise that it repairs Ford vehicles without being an authorized service center and what allows for comparative advertising, such as “If you like Coke, try Pepsi.”
Exercise caution when using marketing materials with a geographic indicator, particularly with coined locations. Refer to place names in a nominative or descriptive fashion, not as a brand name or slogan. Instead of “Your Cold Mountain Real Estate Connection,” try “We Understand the Cold Mountain Market” or “Serving the Cold Mountain Community for Over 106 Years.” Because fair use is not black and white, consult an attorney with trademark expertise. It’s always in your interest to avoid having acceptable language come as a result of a costly lawsuit.
